Multi-million pound plans are being drawn up to build a pioneering waste-to-energy plant in Exeter, the Echo can today reveal.

The proposed £9 million electricity plant will be capable of disposing of 30,000 tonnes of waste each year.

Under the plans, it will be built at the old incinerator site on Grace Road, Marsh Barton.

Bristol-based company Compact Power Ltd is being earmarked to develop the hi-tech facility.

Compact Power, which already has a small clinical waste plant at Avonmouth, uses a new technology to generate electricity from rubbish.

The firm has developed a process called pryolysis and gasification to 'cook and convert' household waste into gas.

The gas is then used to generate electricity.

It is estimated the plant will be able to generate up to 2.5 megawatts of electricity annually.

Devon County Council says the facility will help it avoid hefty fines for burying too much waste in the ground. The Government is imposing tough measures to reduce rubbish dumped nationwide in landfill tips by 240,000 tonnes a year.

From April 2005, councils may be fined £200 for every tonne of rubbish they dump in landfill over the level permitted by the government.

The fine will be coupled with a £3 per annum increase in the landfill tax.

Council officials estimate that based on 30,000 tonnes of waste, this would result in fines of £4 million.

Plans for the scheme are being put together by Devon County Council, working with Exeter City Council, Viridor Waste Management and Devon Waste Management.

A bid for funding for the plant is due to be made to the Department for Environment, Food and Rural Affairs, under its New Technology Demonstrator Programme.

It is hoped the Government will provide between 50 and 60 per cent of the capital cost.

The county council's executive is set to approve the principle of making a funding bid at its meeting on Tuesday.

The deadline for applications for grant aid is next Thursday, June 10.

Philip Alexander, the county council's assistant director for engineering and transport services, said: "The plant would help reduce the amount of rubbish we dispose of in landfill. The proposed plant is not to be like an old-style incinerator.

"It uses the new technology to ensure that emissions meet strict guidelines."

Compact Power chief executive John Acton said: "It will have a big impact in reducing amounts of rubbish dumped in landfill in Devon."